Stage Stores Inc (NYSE:SSI) has denied receiving an offer for a takeover. This follows a filing with the U.S. Securities and Exchange Commission which indicates there was a takeover bid that was lodged. Through a statement the retailer declared that it had not received a bid from a company going by the name of HMA Acquisition.
“In response to a filing made today with the U.S. Securities and Exchange Commission by an entity purporting to be named ‘HMA Acquisition, Inc.,’ Stage Stores, Inc. (SSI) today noted that it has not received any offer,” the statement from Stage Stores read.
Potential acquirer does not exist
The retailer went on to deny that it had any communication with HMA Acquisition before adding that it had been unable to verify the existence of the company that was said to have tabled a takeover bid.
EDGAR, the filing system of the Securities and Exchange Commission has been compromised before resulting in sharp movements in share prices. The hoax was especially prevalent in 2015 when a couple of fake filings were entered into the filing system. One of the most prominent cases involved a company going by the name of PTG Capital Partners which filed a notice declaring intention to acquire Avon resulting in the share prices appreciating by over 15%. It later turned out that neither PTG Capital Partners nor the lawyer responsible for the signing of the filing existed.
Trust but verify
It also happened in 2012 when an offer was made to buy out Rocky Mountain Chocolate Factory. This was according to correspondence between a Republican senator from Iowa and the Securities and Exchange Commission. In its defense, the Securities and Exchange Commission said that the EDGAR system only acted as an informational database but its accuracy could not be relied upon until it had been authenticated.
Stage Stores is present in 38 states where it operates department stores that number 798. The retailer also operates a channel for directly selling to consumers under various nameplates.
In Thursday’s trading session, shares of Stage Stores Inc plunged sharply by 8.62% to close the day at $2.12 a share.
